Power to Tax + Spend Flashcards
Article 1, Section 2 – Representatives and direct taxes shall be ____, according to their __
apportioned among the several States, respective numbers
Article 1, Section 8 says Congress has power to lay taxes but all ___
duties/imposts/excises shall be uniform throughout the US
What is a duty
tax on imports
What are imposts and excises
taxes paid on manufactured goods or other things/events
What was reason for apportionment?
protect Southern states which had lots of people and land (Hylton, Patterson)
There are effectively no apportioned taxes today, since direct taxes are ___
mostly income taxes, which are not apportioned under 16th
Uniformity and apportionment are ___
mutually inconsistent
But both uniformity and apportionment are satisfied by ___
capitation (per person tax)
What is a direct tax
tax on source of wealth
____ say capitation and property taxes are direct taxes
Hytlon, sebelius
Pollock ____ to direct taxes
added income
16th amendment says Congress can lay tax on ___
all incomes (including raised from land) w/o apportionment
Sebelius says can include tax ___
on omission
What is an indirect tax
tax on stuff obtained through that wealth
What are constitutional purposes of taxing
(1) pay debts of US (2) provide for common defense and general welfare
Congress’ power to tax is a major difference between __
Const and AC
What is problem with wealth tax under apportionment
injustice substantially higher in poorer states, fewer people to spread tax burden among
In Hylton, Iredell says that if treating tax as direct would ____ then ___
lead to unjust/absurd results, not a direct tax
Hamburger: Congress can tax to regulate because ___
what can’t do under CC or NP can do under taxing clause
Bailey v. Drexel holding
“tax” was actually a penalty because (1) it was high (10% of all profit, no matter how much child labor used) (2) scienter requirement (3) enforced by DOL not IRS
Bailey supports the idea that Congress cannot tax to ___
regulate something it cannot otherwise regulate under its enumerated powers
License Tax Cases facts
IRS license and fee requirement for selling lottery tickets and liquor (even if purely intrastate)
License Tax Cases holding
Expansive –> Ct agreed Congress would have no power of regulation of business at issue but found Cong. could impose license requirement as a tax (can tax activites can’t directly regulate under CC)
Veazie Bank facts
Federal tax on bank notes opponents charged as “excessive”
Veazie Bank holding
Expansive –> Ct upheld tax, whether tax excessive doesn’t disable Taxing Clause but matter for legislative judgement
McCray facts
tax on margarine probably enacted to benefit butter-makers
McCray holding
Expansive –> Court disclaimed any power to invalidate a tax simply because of the policy motivations that may have prompted it
Court said Bailey case distinguishable from Veazie and McCray because this one involved ___
detailed specifications of a regulation of a state concern and business with a heavy exaction to promote the efficency of such regulation (restrictive)
Steward Machine Co facts
SS Act included tax designed to induce states to adopt own unemployment comp laws
Steward Machine Co holding
Expansive –> upheld a broad power to impose taxes to achieve social policy objectives not merely to raise revenues
Kahringer facts
fed tax on bookies
Kahringer holding
Expansive –> upheld tax, regardless of its regulatory effect, it produces revenue
Hylton (1796) facts
Cong passed tax on carriages (luxury good), not appropriated on basis of population
Hylton holding
Indirect tax so no apportionment required
Hylton Iredell
If cannot be apportioned, it is not direct tax
Hylton Patterson
main (and perhaps) only intended objects of direct tax are taxes on people and land (protect Southern states)
Hylton Chase
rule of apportionment should only be adopted in cases where it can reasonably aply (here can’t without very great inequality and injustice)
Pollock
federal income tax that was not apportioned
Pollock holding
tax on person’s entire income is direct tax so fed income tax unconstitutional
16th amendment says Congress shall have power to lay and collect taxes on incomes ____
from whatever source derived, without apportionment .. and without regard to any census
Dangers of using tax as regulation
not limited by subject matter (threatens limits on govt), different consequences (if breach regulation go to hearing, if don’t pay tax IRS has harsh administrative proceeding)
A regulation ___ but taxes may just be __
creates a duty, part of doing business
